Latest / GAIN Momentum / Frameworks Are Everything | with Michael Cohen
Transcript
- GAIN Momentum episode #4 - | with Michael Cohen === Welcome to the Gain Momentum Podcast, focusing on timeless lessons from global industry leaders about how to grow and scale of business in hospitality, travel, food, service, and technology. I'm Jason Imanis, joined by my co-host Adam Molinsky. Adam, how are you? I'm always great. That's good. That's good. Today our guest is Michael Cohen, managing partner with Gain Longtime Hospitality, executive coming to us from Toronto. How are you, sir? Always great Jason. Always great, Adam, take it away. So Michael, our format for this podcast is we're focusing on timeless lessons framed around four key questions. Now, those timeless lessons could be for seasoned veterans or all the way down to young 20 somethings in college or just outta college looking to navigate the world. And even though we are talking about travel and hospitality, they really apply to any business. So with that in mind, I'm gonna go into right back into the first question. When it comes to scaling a business, what is the single piece of advice you would give entrepreneurs from your perspective as a professional in hospitality? That's a really good starter. Um, work within a framework, so the framework can be rigid, it can be loose. It can be revised, but it's, I think, really mission critical for any business person, especially if you're, if you're running a startup, a scale up or an enterprise opportunity as a founder or as an executive, you need to have a framework that is, um, kinda like your, your map, your roadmap, but it keeps you in. You got, you got a color, you got a color in the lines. Because the challenge is if you don't, there's a lot of, opportunities for inefficiency, mistakes, extra stress. So really for me, it's all about understanding what the framework is of your business, and that could be in the ideation stage, and then executing upon that framework and all of your conversations internally and externally. Your decisions, financial or otherwise, staffing, product development, fundraising, go to market. They all have to work within a framework that, um, becomes even more precise over time because when there's, when there's real dialogue and real feedback from the industry or, data in general coming back into the organization, small, medium, or large. It all has to filter through that framework and it gives you this, it just kind of puts guardrails on what you do day-to-day as well. And as we all know, it's iterative process in any business, right? You work on day-to-day enhancements, layers, challenges, sometimes successes that are unexpected, but if it's within a framework, it keeps you focused and grounded. Yeah, you need agreement on that framework too, right? I mean, um, I bet a lot falls down because three people in the room are in agreement and then there's two that are not, and then separate agendas and. Yeah. I mean, and, and, and Jason to that point, you know, um, business is about people and, you know, I personally have had some successes and I've had some challenges. And probably the, the challenges I had was around the fact that my own fault, I, I take responsibility for this. I. you know, didn't get buy-in from all my other partners in regards to what the framework truly is or their framework was different than potentially what, what I felt the framework was. And I know we're using framework as like a metaphor almost, but it really is. It's this, it's this core, utility I guess, to keep things focused and keep things consistent. And in the successful implementations. Businesses, either as an executive or as a founder. It when the, when there was, as you said, when there was mutual buy-in on what the framework was, how to, react and execute upon the framework, things went very, very well when there was miscommunication or misalignment on the framework. And again, I take responsibility for that. Um, uh, and I've learned from that even, even in recent, uh, times. With very, very important people in my life that the framework just didn't align and we, and we ended up having challenges. that's something that I would strongly recommend that people think about, that, you know, if, if they're entrepreneuring within a corporate environment or they're entrepreneuring within a, you know, startup scale up environment, gotta have a framework. Not to be the devil's advocate here, but can you think of any past examples where you knew it was time to change that framework? Yeah. Um, actually it was, it was my first startup. I was 26 years old. What the heck was I doing? Being a founder of a startup, a 26 year old, I don't know. It was a middling success in the end, meaning that it was, you know, it was okay. but I didn't know, you know, the old adage, I did not know what, I did not know at that time. 26 years old, you know, with three other founders, two other founders. We started a, this is interesting. We, I think hopefully it is. We started a digital paper company. We started Adobe Acrobat before there was Adobe Acrobat. Wow. super small company. Sold it to a North America company called, Diane Durham. Diane Durham is a forms company and, and this was in the nineties, And, you know, paper forms still were billions and billions of dollars in business. And, uh, we created digital forms Before they were internet-based forms and everything else. They were Adam. They were three and a half Toke digital forms where we, we took paper forms from banks and insurance companies, and we, we converted them to digital format on an exc dot, exc running and dos and, and just the beginning of Windows 2.0 with the graphical interface again. Interesting. It was very lucrative, actually for a bunch of 26 year olds. But the framework needed to change. I didn't have the experience to understand that a framework was required. and what happened was is that when, graphical Windows interfaces became much more prevalent, We were late to change because we had such a lucrative business in the Doss and pre, uh, graphical windows space. So thank God. I'm not saying I was in the punch card era. I'm not that old. But, um, that was really, I can remember the first time where if, you know, when those, if I knew then what I knew now, we probably wouldn't be having this conversation because I would be in my private island. In the Caribbean, Wow. if you understand what I mean. Because it was incredible opportunity. We did well, but we didn't do as well as we should have, and we ended up selling the co, the company to a company called JetForm that out of out of Canada, Ontario, Canada, which was then acquired by Adobe, but we weren't acquired by Adobe. Unfortunately, we were acquired in a much smaller transaction. By the middle stage of it. Frameworks would've helped. going into the second question here, Michael. What are some of the common pitfalls or failures you have witnessed that business owners should look to avoid when scaling their business? Okay. I'm, I'm somewhat related to the first, losing focus, chasing traction, bleeding outside the framework. To me that is such an important. Discipline to make sure that you don't lose focus, you don't chase the traction, and you don't bleed inside the outside the framework. listen, especially, you know, if you're, if you're a corporate executive and you're running a division, you're, it's your own, you know, that's your, your preneur division and you have KPIs and numbers to hit, and you have a, if you are the CEO or you report to the CEO or an, or an svp, you know, you want to meet and exceed expectations, meet and exceed revenue. and we all have, succumbed to the. Catnip of, wow, This deal's gonna change everything. Of course, we have to redevelop or restructure or re, you know, repaint the color of the car or whatever it is, but it, look at the revenue we're gonna get outta this. And then it becomes chasing your tail to chase traction. So losing focus, chasing traction without having it stay within the framework that we talked earlier and not letting it bleed outside that. So incremental traction within the framework is a safer bet than going off the reservation. How about this? It's, it's a more manageable, scalable bet because the, listen, the key, in my opinion, the key to any great business and, and it's obviously executed in a multitude of different fashions. You know, people say scale, scale, scale. Right? Grow, grow, grow. What's the name of the company that. Many of us are involved in right growth advisors. International network it cannot be growth for growth's sake. It cannot be growth, at any cost. It has to be iterative, incremental. I like to use the word Jason. I, I use this a lot. Layered it's layers. You layer innovation on other products. You layer, you know, sales and marketing, uh, capacity. You layer maybe geographical expansion. You layer expanding your product, uh, line that, that, that's relevant and so on. So it's not huge pivots and it's not knee jerk and you're not chasing traction. Conversely, being too, too focused and rigid and not digesting the nuances and slight pivots in it that the industry feedback is delivering to you is also a challenge. That's not a great place to be. So being too focused and too rigid. Hmm. So there is always, there's that sweet spot. There's always that, you know, that, that, that fine tuning. So, uh, I, I think that's just a, a good kind of the ying and the yang of that, uh, answer, if you don't mind. can you offer any device for how you strike that balance between that ying and the yang of chasing traction, chasing growth, and keeping it within that, that layers, that still keeps in mind that framework. Yeah, I, I think that, you know, I am a big, this is from, you know, business is about people like, like I think many of us talk about, I'm a big proponent of offsites annual, semi-annual offsites, for example. And if, if all of the right people are in the organization are getting together in an offsite, usually good, good work happens. That's what they're for. Yes, they're for social interaction, yes, they're for building relationships, but they are for contemplation and for having some quiet time to really, strategize and to make plans and to project and to make some bets. These have to be intelligent bets. They have to be, you know, qualified bets, but they're still bets because none of us ever in business and sometimes in life really know what's coming around the corner. We don't know a pandemic is coming. Obviously we don't know that interest rates are gonna change. We don't know that, you know, suppliers of our memory that's required for a piece of hardware is gonna be delayed in a factory in China or something. Or we don't know that the tastes of the consumer may change or that something has changed in, in the, in the zeitgeist again, or the Society of Consumers or business to business opportunities. So what's, what, what's important is to respect and stick to what those offsites and those strategic initiatives, those, those, crystallization of what the company's gonna do for the next six months, for the next year, to have some respect for that. It doesn't have to be, again, too rigid and too, robotic, but you, but you gotta, first of all, you have to have those events, whatever that means, virtual or otherwise. You need to take the time to have intellectual offsites with your team, your members, your founders, your board, your investors, et cetera. And you have to respect that. Okay, Michael, on that note, we're looking ahead to the future and what do you see as the key opportunities and challenges for hospitality companies in 2023 and beyond? Okay. So I'm gonna go with. Two kind of directions. One, many of us have talked about in our industry, in this global, very large travel and hospitality, technology and travel hospitality industry in general is the back of the house optimization, automation, and innovation. For the face, foreseeable future demand is gonna be up. Demand may, you know, post, post pandemic demand is up. It's, it looks like it's gonna stay up for a period of time, you know, hotel travel destinations are consistently, and they have been for the last year at least, coming on board with. A ton of, uh, of demand to, uh, to service from guests, passengers, patrons, cruise ships, restaurants. But staffing issues and service optimization will remain huge. Challenges and require serious, operational success by entities, brands. Ownership groups, et cetera. So I really see the back of the house optimization, automation, and innovation as the opportunity in our industry, that, of course self-serving, a lot of hospitality technology can be focused on that. A lot of startups are focused on that. A lot of very mature companies have been doing great work, obviously in that for, for decades. And they're gonna keep expanding their product line and offering and services based around this massive. Requirement and demand for optimization, automation, and innovation in the back of the house. Secondly, I'm gonna go more wide and more pure, innovation oriented, huge opportunities, and some of these are buzzwords. But I don't care because they're, they're real. They're coming, or the train's already left the station. And I'm not just talking about Metaverse, which some people in the industry have heard me talk about a bit over the last year and many others that that's part of it. It's about generative ai, which is very topical today. It's about immersive tech, which is ar, vr, et cetera. Mixed reality and it's robotics, so generative ai, immersive tech, and robotics. if I was the 26 year old Michael and someone had just, you know, I was able to have access to 500,000 or a million dollars in seed capital, or if I was a corporate executive. Who had a budget of a million dollars, 1.5 million to do a product extension or something relevant to our, to grow our business. That's a mature business I would be focusing on. On those areas. Generative ai, immersive tech, and robotics. Totally on board with those. Makes so much sense. I mean, the labor shortage is, it's such a big problem. And I think from where I've been operating the past year, if you can fix pay, you can fix flexibility with your people. Understand that you're never gonna be hiring the amount of people you use to. So automation, equip 'em with the tools, apps, software, whatever it is, features when the within existing software that makes their life easier. And then robotics. And, and whatever can help you at the front desk and streamline where people aren't shackled to the, their day-to-day. You know, I'm, I'm shackled to this, screen in front of me and, and I've got, you know, 2,500, guests walking by, you know, every week, you know, so yeah. Big problem. Because also well put. Those that those tech are solution sets, you use the word freedom, they free. They are going, they are today and they will definitely within over the next five years, a huge revolution in this. They are going to be freeing the staff. To be focused on more valuable, impactful delivery of service or production of work product or whatever. Because the drudgery, every, all of our jobs have some level of drudgery and repetitive nature, and blocking and tackling, those will be eliminated in all levels of. Our industry from, you know, guest facing or back of the house or cruise ship or travel an airport or et cetera, right? The drudgery that is a part of every level of position. Most of that will be, there'll be an opportunity for that to be eliminated and therefore, potentially a smaller, or the maintained u uh, workforce. Will be working on higher value, higher margin, more impactful deliverables with their time. Moving on to the fourth question here. What are the key things innovative leaders and entrepreneurs should prioritize and focus on to gain traction for their business? Idea eight idea generation round tables. Contemplation. So ideation, dialogue, internal or external. Focus on a, if it's a startup or a scale-up focus on a great M V P. Minimum viable product or service. So ideate dialogue, mvp, and then listen. Listen to the feedback. Once the MVP is out there in the market, or your new product extension is released to a closely held group of industry advisors or closely held clients. Listen. And then the most important and challenging part of this, and I have a challenge with this too, is pause. Take a pause. So ideate, dialogue, mvp, listen, and then pause, then you revise, then you launch, then you review, then you execute, and then you scale. Super important, that flow, that roadmap. Ideate dialogue, mvp, listen, pause, revise, launch, review, execute, and scale One last thing that if I could important is from a priority perspective, prioritize multiple paths to revenue and margin. Prioritize multiple paths to revenue and margin. Don't just think about, no, it may not be, it may not be easy to do this, but is it direct? Can I have an indirect model? Is there an OEM opportunity and licensing opportunity? Prioritize multiple paths to revenue and margin. Super important. Yeah, gotta listen to those customers. Still help people. They'll help you with all that. Right? Yeah. I was just wondering if you could put that into a catchy acronym that everyone could remember that You know what? Here, here's, here's an MBA term acronym, schrum. Um, it's, it, it's, it's actually more fun to just blast it out like that. I mean, look, it, it, maybe we should make, I'll make a poster of it so people, you know, so people that I work with can put it on their walls. I don't know, but, um, It is logical. I know it's, listen, there's a lot there, but I think hopefully, you asked me a question. I gave you a, a heartfelt answer that I use every day. It's that kind of methodical process with pause and then the next stage of the methodical process. And it is a, it is a, it is a conversation. If you, you've maybe felt that there's a conversation happening throughout the, that that process because it can't just be drinking your own Kool-Aid. You need to have contemplation, reaction, feedback, whatever, digestion, et cetera. You know, you mentioned the pause, which is so critical in that, process and the one before, which I sort of think of as well as listen, which I think is almost pausing to listen to your, your customers and the people you're trying to reach. Do you have any tips on how to become a better listener from a business perspective? Well, people that know me well and know that I've been working on that for 27 years. Um, yeah, look, uh, Maybe something outside of, uh, the norm. I've worked me on meditation, I've worked, I've used meditation skills, calming skills, breathing skills. Again, this is not special. I'm not special, but it's, there's a lot of great content out there, how you can take a lot of the skillsets in regards to, um, self health wellness, which Adam, I know is a big, uh, area of your, uh, interest. But take those kind of principles and skill sets and um, tactics. And I say that in the most gentle way, tactics, and bring them into your business life, you know, so a little secret about me that maybe now I'm telling some people is, if you ever see me in a meeting in the physical world, I will have, I will be doing this. And it's, I'm not trying to, I'm not using some Italian thing that's gonna tell you that eth to, you know, to piss off or something. This is a, a physical. Representation of something called a memory hook. And it's a neural linguistic programming technique that I learned many years ago. And when I do this, even right now just doing this, putting my thumb in this scenario, it brings me into a calmer state. So many times I'm in a meeting and I have both my hands under the table doing this because it means something to me physically right away, which which triggers. A certain, and Adam, you know, much more what I'm talking about. It triggers either if it's a chemical situation or it's something, it's, it's a calming effect and it lets me listen and not have to be, so forward all the time. And, uh, all of us are human. All of us are every day are trying to get better and trying to improve ourselves. But it's very, very helpful to me. So, you know, if you see me in a meeting doing, you know, with my hand, my thumb between my fingers, It's, it's strange maybe, but that's what works for me. Yeah, there's, uh, there's probably a more complicated term that people could find on Wikipedia or Ask Chat g b t. which, which may or may not come with the exact answer. It may, it'll make, it'll make one up. That'll be great though. Yeah. Well, it's, it's, it really is amazing that the number of people that I've read about and including myself, who really consciously practice meditation or some sort of. Concentration focus, exercise to help improve all aspects of life. It's been really important in my life to get through good times and challenging times and absolutely in my professional life. because we're, again, we're all human beings. The biggest cha business is about people, and sometimes you have challenges between individuals, humans, founders, clients, we all do, corporate executives, your boss, the banker, you know, who's funding your business or, or the vc. So it's really been very, very helpful to take that kind of, ability to, to calm myself or calm ourselves. It also helps in being more contemplative. even a couple times during this, this interview today, I did what I, I did my physical trigger a couple times subconsciously, but I know I did it, you know, cuz Adam, you make me really nervous, right? So I wanted, I had to calm myself. But, um, but no like that, it, it's such a great tool and it's, it's, it's great in any time of any situation in life. It's great when you're at the airport and it's stressful. It's just, I don't wanna overdo it either, but it's been very helpful for me. Wow. Well, on that note, uh, Michael can't thank you enough for coming on. Very, very useful lessons, uh, that everyone I know will get something from. Thank you. That's great, and, and, and I appreciate what, uh, you, Jason, and John, and others are doing, uh, with this podcast. first of all, you're excellent advisors and partners, if I may say. I know I'm now talking about gain for a moment, but I really appreciate working with you. I'm very fortunate to work with you and many other people in the global organization and, these, sessions I think are continue to be interesting. Hopefully I lived up to the other guests, uh, level of, of, of interest they created. But, uh, thank you for your efforts. Yeah, thanks for joining us.